Mexico has officially nationalized its lithium industry after the Senate approved by 87 votes in favour, 20 against and 16 abstentions the mining reform proposed by President Andrés Manuel López Obrador, which gives the state exclusive rights over the battery metal.

The bill elevates lithium to the category of “strategic mineral”, declaring the exploration, exploitation, and use of lithium to be the exclusive right of the state. It also includes a clause allowing the state to take charge of “other minerals declared strategic” by Mexico.

The executive has now 90 days to create a new, decentralized body to deal with all lithium-related matters.

Since taking power in 2018, López Obrador has fought to reverse resource reforms under previous governments, which opened up the oil and electricity sectors to private investment. He has pushed a resource exploitation model that gives priority to state-controlled companies.

The President said his administration will review all lithium contracts, which casts a shadow of doubt over projects already being developed in the country, including the one held by Bacanora Lithium (LON: BCN) in the country’s northwest. The company, owned by China’s Genfeng Lithium, owns the giant Sonora project, which is slated to produce 35,000 tonnes of the metal per year starting in 2023.

https://mqworld.com/2022/04/22/mexico-nationalizes-lithium-mining/

So, since Ganfeng owns Bancanora.. at least until last week.. what kind of pressure is this going to put on Ganfeng Ltd and will that situation in Sonora State of Mexico have any ripple effect on Gangfeng's partnership with LAC in regard to Cauchari-Olaroz?  Since Ganfeng Ltd. had previously executed Off Take agreements with Bancanora before the now defunct Ganfeng purchase of Bancanora what happens now to those Off Take agreements?  What is the price Ganfeng is going to pay from this Nationalization by Mexican President Lopez Obrador?  Is Bancanora going to be a total loss, a partial loss or no loss for Ganfeng?

Lots of questions in a political situation affecting lithium mining that is still in flux.  As for Argentina and its relationship with Ganfeng Ltd I suspect that connection is still in tact, both for now and long into the future since the relationship between the governments of China and Argentina is somewhat of a Bromance as long as China supports Argentina's claim to what the UK calls "the Falkland Islands".  

Onward through the FOG, indeed!

Okiedo